Future Bright, but Watch Out Short-Term: Goldman’s Cohen

Javier E. David|Special to CNBC.com

Tuesday, 21 Aug 2012 | 11:39 AM ETCNBC.com

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Abby Joseph Cohen

Investors have reasons to be optimistic about the longer-term outlook for markets, but policy uncertainty in both the U.S. and Europe are immediate causes for concern, Goldman Sachs' top equity strategist Abby Joseph Cohen told CNBC Tuesday.

Dubbed the “perma-bull” for relentlessly upbeat market assessments that helped her achieve prominence during the bull market of the late 1990s, Cohen also weighed in on a debate stoked by Pimco bond maven Bill Gross, who recently poured cold water on the idea that stocks would continue to return sizeable gains to investors.

Abby Joseph Cohen, Goldman Sachs senior U.S. investment strategist, discusses the individual investor, China and risks facing the markets for the remainder of 2012, particularly given what's going on in Washington.

Cohen suggested that a "fear factor" of a European debt meltdown — as well as the looming "fiscal cliff" and economic weakness in the U.S. — was beginning to retreat from market psychology as stocks continue to rally. Still, investors were right to be worried about near-term policy risks. (Read More: Goldman to Clients: Get Out of Stocks Before ‘Fiscal Cliff’ Hits.)

"This is one of those times while where we are comfortable with the medium-to longer-term outlook, we ... are looking at the shorter-term, and have some concerns primarily about the political situation not just in United States, but in Europe."